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Posted on August 20th, 2012, by

Nowadays, there are a great deal of different governmental programs which have the major purpose to improve the work of those governmental agencies which have developed their programs and handle them successfully. Some programs are worked out to improve the life of people in our society, others are designed to render appropriate assistance in this or that sphere of our society, to implement new technologies and methods. It is known that these governmental programs depend on governmental spending which is performed at several levels of government including state, federal and local governmental agencies. Federal Aviation Administration is one the federal governmental agencies that have already developed a great deal of different programs.

My goal in this paper is to evaluate one of the governmental programs of the Federal Aviation Administration. In order to achieve this goal it is necessary to define financial compliance which determines whether the funds were properly spent. It is also very important to determine whether the law was complied with. The other thing is that it is necessary to define economy and efficiency which determines whether resources have been used economically and efficiently. Of course, the program results should be also discussed in this paper.


     Federal Aviation Administration is a very important governmental agency which is responsible for the safety of civil aviation in the United States. This agency belongs to the United States Department of Transportation. According to the Federal Aviation Act (1958), this organization was named Federal Aviation agency. In 1966, it was given the current name Federal Aviation Administration, or FAA.

It is known that Federal Aviation Administration performs  a great deal of different roles. They are the following ones:

  • to regulate commercial space transportation of the United States;
  • to control flight inspection standards;
  • to develop new aviation technologies;
  • to control civil aviation;
  • to develop the system of air traffic control and navigation. It is related to both the civil aviation and military air craft;
  • to conduct researches in the sphere of the National Air Space System;
  • to develop civil aeronautics;
  • to develop special programs in order to control various effects of aviation including aircraft noise, sonic boom and other environmental effects of the US civil aviation.
  • to control the use of navigable airspace on the territory of the United States;
  • to install and navigate up to date air navigation facilities.

This governmental agency has its seal. (See Fig.1)

The annual budget of this organization is $15,956 billion, fiscal year 2010.


                  Fig.1 The Seal of the FAA


Among the numerous programs of the FAA, one can find Air Traffic Control Program, National Simulator Program which have the major goal to improve the safety of aviation in the United States; Aviation Safety and Health Program, Aviation Safety Action Program, National Airshow Program, Airport Environmental Program, Passenger Facility Charge Program, and others. (Federal Aviation Administration, Official Site, 2011)

As Federal Aviation administration regulates civil aviation and its safety, it plays an important role in the development of the country because the high level of aviation proves that the United States is a powerful state. That is why the implementation of new computer technologies and methods of control is essential for the successful development of the organization.


     The Airport Improvement Program was specially developed by the Federal Aviation Administration in order to improve the nationwide system of airports and to assist the growth of civil aeronautics.

The Airport Improvement program, or AIP is a special program which provides certain grants not only to public agencies but also to some private owners in order to organize planning and further development of the airports used for the public services. These airports should be included in the National Plan of Integrated Airport Systems. (Federal Aviation Administration, 2011)

The History of the Airport Improvement program

     The Airport Improvement program has its history. It is known that in order to promote the development of the airport system and to meet the needs of the nation, the Federal Government of the USA decided to introduce the grants-in-aids program after the World War II.  The first program was called the Federal Aid Airport Program (Federal Airport Act, 1946). The funding was taken from the general fund of the US Treasury. In 1970, according to the Airport and Airway Development Act, another more comprehensive programs were established the Planning Grant program and  the Airport Development Aid program. The above mentioned programs were funded from the Airport and Airway Trust Fund which was established in 1970. This Fund included the revenues taken from the aviation users taxes. This money was spent on aviation fuel, air freight and on other items. According to the statistical data, during the period of 11 years about 9,000 grants were approved, totaling more than $4,5 billion. This is considered to be a rather large sum of money.

Today, the program has another name the Airport Improvement Program. It was established in 1982, according to the Airport and Airway Improvement Act. Of course, the program  had some changes but they were made with the only purpose to improve the current aviation system. It is known that funds for the Airport Improvement Program are taken from the Airport and Airway Trust Fund. This Trust Fund is supported by the fees which are paid by the users of the airlines, fuel taxes and other revenues. (Federal Aviation Administration, Overview: What is AIP, 2011) For example,such revenue sources  include 7,5% ticket tax, $3,6 flight segment tax, 6,25% tax on cargo, 4,3 cent for the fuel of commercial aviation, $16,1 international arrival/departure tax, 7,5% ticket tax taken from the passengers at rural airports, and some others. (Kirk, 2009, p.28)

Financial Compliance

     It is known that the funds which are provided by the Airport Improvement Program are distributed for airport development and planning. Those airports which take part in the AIP include not only the large publicly owned commercial airports but also the small ones which may be publicly owned but should be available for the public use.

According to the reliable sources, the funds are properly spent. It is known that the distribution system of grants is rather complex because it includes the combination of formula grants and discretionary funds. The Federal Aviation Administration regulates and controls the system of distribution. Each year some certain sums of money are given to specific airports, primary airports, cargo service airports, Alaska airports. The remaining funds are discretionary funds which are used to pay for some capital development needs of the airports.(Kirk, 2009, p.12)

One of the most important funding of the AIP is funding of airport security. It is known that the AIP is the major source of federal grants which are spend for the airport security projects in order to prevent terrorist attacks. According to the statistical data, about 17% the total spending of the AIP is spent for appropriate airport security projects. For example in 2002, it was $561 million of $3,2 billion of the whole amount.

One more important fact is that the program does not violate the US law. The Airport Improvement Program is based on the legal authority including different Acts, amendments to acts, Statute Codes, and other legal sources. (Federal Aviation Administration)

Economy and Efficiency

     Of course, it is very important for the Federal Aviation Administration to pay special attention to the issues concerning economy and efficiency of the program which determine that all the resources have been used economically and efficiently.

It is known that Benefit-Cost Analysis helps in making right capital investment decisions. It determines if the benefits of some planned action justify its real costs. Those money which should be spent on some project will be calculated by the specialists who will be able to determine if this or that project is economically efficient. It is also known that the Federal Aviation Administration is not the only transportation agency which requires the Benefit-Cost Analysis. The most important thing is that the FAA should use Benefit-Cost analysis to evaluate improvements at airports.

For example, Houma-Terrebone Airport which is located in Houma, Louisiana participated in the Airport Improvement Program last year.

The efficient benefit-cost analysis used by the Federal Aviation Administration found that the proposed project was a successful one. The major goals included the following ones:

  • strengthen the primary runway of the airport, runway 18/36, in order to accept larger and heavier air crafts;
  • to strengthen the existing parking apron;
  • to improve the automobile road which is located on the territory of the airport. (Landau & Weisbrog, 2009, p.35)

Program Results

     The program’s results which determine that the desired results have been achieved include the following ones:

  • construction of the new public airports;
  • improvements of existent public airports according to the modern standards;
  • extending runways which are situated at existing airports of the USA;
  • purchasing of modern fire fighting equipment;
  • purchasing new rescue and security equipment;
  • planning at different individual airports;
  • airport noise control;
  • conducting the environmental studies.


     In conclusion, it is necessary to say that today airports are considered to be vital national resources. They play an important role in the transportation of people and goods. They  are also very important for international, regional and national commerce. That is why the Airport Improvement Program should be introduced in a proper way. It requires a great deal of control and all the funds should be well-spent.

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